Optimizing Reward-Based Crowdfunding

In this paper, we have provided insight into reward-based crowdfunding (RBCF). Individual ownership or temporary usage products and four different types of rewards have been evaluated — prototype, branded promotional item, special edition, and discount. We have determined whether intrinsic or extrinsic motivational strategies and the timing of the reward play a significant role. We have found that individual ownership items received more funding than temporary usage products. Certain rewards are more effective than others in garnering contributions from backers and we have identified the cases where this occurs. RBCF knowledge is important, and we have provided recommendations for entrepreneurs about how to appropriately structure their call for funding.